How long does it take to get out of ChexSystems?
Federal regulations allow ChexSystems to keep records for up to seven years. However, ChexSystems only keeps records for up to 5 years. If you don’t want to wait that long, you can dispute the accuracy of your record to get out of ChexSystems early.
ChexSystems Removal: 4 Steps
Follow the steps below to get removed from ChexSystems.
1. Order a Free ChexSystems Report Online
The Fair Credit Reporting Act (FCRA) allows you to order a free credit report from TransUnion, Equifax and Experian once a year. What you may not realize is that, as a consumer reporting agency, federal law also requires ChexSystems to provide you with a free annual report upon request. You need to know exactly what your ChexSystems report contains before you can successfully contest the information.
If you’ve already requested a free credit report from the three major credit bureaus, this does not affect your eligibility for a free ChexSystems report. The law gives you the right to pull each of your reports annually, not just one or two.
You can order a copy of your report 1 of 3 ways:
- Call their automated voice messaging system at 800-428-9623.
- Visit the website, fill out the consumer disclosure form, and submit it online
- Print out the form and sent it by certified mail to:
Chex Systems Inc.
Attn: Consumer Relations
7805 Hudson Road, Suite 100
Woodbury, MN, 55125.
See also: Top 8 Second Chance Checking Accounts
2. Evaluate Your ChexSystems Record for Accuracy
The Fair Credit Reporting Act (FCRA) requires all creditors to report only accurate information to consumer reporting companies. This includes ChexSystems. Evaluate your report carefully for errors and ask yourself the following questions:
- Does the report contain the date of the supposed transgression and, if so, is that date accurate?
- Is the amount of the bank debt accurate?
- Is the scheduled removal date accurate?
- Is the checking account number for the bank debt accurate?
- Do I recognize this debt at all?
Remember, you are entitled to dispute any information that reflects an inaccuracy. The U.S. Public Interest Research Group reports that 78% of consumer reports contain inaccurate information. Finding inaccuracies in your ChexSystems record shouldn’t be that difficult.
Even if you don’t locate inaccurate information, you still have the right to force the bank to verify that its report is, in fact, correct. If it fails to do so, you can demand that the bank remove its report.
3. File a ChexSystems Dispute
Send a letter to ChexSystems, along with a copy of your free consumer report that demonstrates the entry in question, and request an investigation into the debt. If the entry contains certain clear inaccuracies, you may mention these.
However, it’s best to let your first dispute be a simple blanket dispute. If you wish, you can split hairs with ChexSystems later should your initial disputes not result in the removal of the negative information from your record.
ChexSystems has 30 days in which they must, under federal law, contact the bank that furnished the derogatory information and obtain validation that the account is being reported accurately. If the bank doesn’t respond, ChexSystems must remove the report.
Don’t panic if the bank verifies the information, as they usually will even if the data is inaccurate. The purpose here isn’t to actually procure an early removal but rather to create a paper trail demonstrating your efforts. And also to put the bank in a position in which it has no choice but to remove the derogatory information or face a lawsuit.
4. File a Dispute with the Bank Directly
After ChexSystems notifies you that the account is accurate, write your bank or credit union a letter notifying it that you’ve discovered a debt recorded in your ChexSystems report and need the bank to investigate. Keep in mind that this process, while similar to the debt validation process, often used to remove collection agency accounts from a credit report, is considerably different.
Financial institutions like banks and credit unions don’t typically have to validate your debts. However, they do have to conduct an investigation if you dispute the validity of their reporting method. If they do not respond, your only option is to take them to small claims court.
The bank must provide you with the information they provided to ChexSystems when you originally disputed the debt.
Because bank documents frequently change hands, records are frequently lost, destroyed or not properly stored. The likelihood that your bank will be able to come up with any proof of your debt during its investigation is slim. The older the bank debt is, the better off you are.
After 30 days, the bank must provide you with the results of its investigation. What can you do if there are no results? You are entitled to file a lawsuit against your financial institution for verifying the accuracy of its report to ChexSystems when it lacked proper records of your original debt. Sometimes, just the threat of a lawsuit is enough to spur the bank into modifying its report, getting you out of ChexSystems early.